Correlation Between Veea and Baron Durable

Can any of the company-specific risk be diversified away by investing in both Veea and Baron Durable at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Veea and Baron Durable into the same portfolio, which is an essential part of the fundamental portfolio management process.

By analyzing existing cross correlation between Veea Inc and Baron Durable Advantage, you can compare the effects of market volatilities on Veea and Baron Durable and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Veea with a short position of Baron Durable. Check out your portfolio center. Please also check ongoing floating volatility patterns of Veea and Baron Durable.

Diversification Opportunities for Veea and Baron Durable

-0.58

Correlation Coefficient

Veea  Baron Durable

Excellent diversification

The 3 months correlation between Veea and Baron is -0.58. Overlapping area represents the amount of risk that can be diversified away by holding Veea Inc and Baron Durable Advantage in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Baron Durable Advantage and Veea is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Veea Inc are associated (or correlated) with Baron Durable. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Baron Durable Advantage has no effect on the direction of Veea i.e., Veea and Baron Durable go up and down completely randomly.

Pair Corralation between Veea and Baron Durable

Given the investment horizon of 90 days Veea Inc is expected to under-perform the Baron Durable. In addition to that, Veea is 7.91 times more volatile than Baron Durable Advantage. It trades about -0.09 of its total potential returns per unit of risk. Baron Durable Advantage is currently generating about 0.08 per unit of volatility. If you would invest  2,781  in Baron Durable Advantage on September 28, 2024 and sell it today you would earn a total of  129.00  from holding Baron Durable Advantage or generate 4.64% return on investment over 90 days.

Time Period	3 Months [change]
Direction	Moves Against
Strength	Very Weak
Accuracy	100.0%
Values	Daily Returns

Veea Inc  vs.  Baron Durable Advantage

Veea Inc

Risk-Adjusted Performance

0 of 100

Very Weak

Over the last 90 days Veea Inc has generated negative risk-adjusted returns adding no value to investors with long positions. Despite inconsistent performance in the last few months, the Stock's technical and fundamental indicators remain somewhat strong which may send shares a bit higher in January 2025. The current disturbance may also be a sign of long term up-swing for the company investors.

Baron Durable Advantage

Risk-Adjusted Performance

6 of 100

OK

Compared to the overall equity markets, risk-adjusted returns on investments in Baron Durable Advantage are ranked lower than 6 (%) of all funds and portfolios of funds over the last 90 days. In spite of fairly strong basic indicators, Baron Durable is not utilizing all of its potentials. The current stock price disturbance, may contribute to short-term losses for the investors.

Pair Trading with Veea and Baron Durable

The main advantage of trading using opposite Veea and Baron Durable positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Veea position performs unexpectedly, Baron Durable can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Baron Durable will offset losses from the drop in Baron Durable's long position.

The idea behind Veea Inc and Baron Durable Advantage pairs trading is to make the combined position market-neutral, meaning the overall market's direction will not affect its win or loss (or potential downside or upside). This can be achieved by designing a pairs trade with two highly correlated stocks or equities that operate in a similar space or sector, making it possible to obtain profits through simple and relatively low-risk investment.

Check out your portfolio center.

Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Portfolio Optimization module to compute new portfolio that will generate highest expected return given your specified tolerance for risk.